What is London Living Rent?
We know how difficult it can be to take your first step on the property ladder, especially in the capital. The cost of rent combined with the cost of living can make saving for your own home feel impossible. But we don’t think it has to be that way, which is why we’re delighted to offer London Living Rent as a way to help you save for a deposit and make the move into your very own home.
London Living Rent is a government-backed scheme that enables Londoners to rent a home at a discounted rate comparable to renting privately, with the saving made each month going towards buying a home through Shared Ownership.
The aim of London Living Rent is to support middle-income buyers to get onto the property ladder and purchase their own homes. It’s designed to allow renters to save at their own pace over a period of years, as properties under London Living Rent guarantee tenants an assured shorthold tenancy of a minimum of three years and a maximum of ten.
Benefits of London Living Rent
With reduced rental costs, you can save money every month and put it aside for a deposit to buy your own home.
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Helping you save for a home
London Living Rent allows you the opportunity to rent a home at a reduced rate. The below-market rent level allows you to save towards a deposit faster by reducing your monthly outgoings.
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Live in great locations
You can rent in a great locations without compromise due to the reduced rental rate and have the option to buy later through Shared Ownership.
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A step to Shared Ownership
London Living Rent is for people who want to buy their own home, can afford the monthly outgoings associated with home ownership, but need support in raising enough funds for a deposit.
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Flexibility
Get all the freedom and flexibility of renting, with the reassurance of saving towards eventually stepping into home ownership.
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Support
Our team is dedicated to supporting you throughout the home-buying journey and will support you in ensuring you are on track for your saving goals to purchase through Shared Ownership in the future.
Am I eligible for London Living Rent home?
Eligibility can vary by development, however there are some overarching criteria that you need to meet to ensure you are eligible for London Living Rent.
Eligibility for London Living Rent is restricted to Londoners that either have a formal tenancy (for example, in the private rented sector) or live in an informal arrangement with family or friends as a result of struggling with housing costs.
Key eligibility criteria:
- Have a maximum household income of £60,000
- Live or work in London
- Have a formal tenancy (for example, in the private rented sector) or live in an informal arrangement with family or friends as a result of struggling with housing costs
- Not own any other residential home
- Be unable to currently buy a home (including through Shared Ownership) in your local area
When funded through the GLA’s Affordable Homes Programmes, London Living Rent is expected to actively support tenants into home ownership within ten years.
How much rent will I pay for a London Living Rent home?
While you’ll pay lower than market rents, the amount you pay depends on a number of factors including where the property is located. The Greater London Authority (GLA) sets maximum rents by number of bedrooms in every ward across London, and these figures are updated every year.
The rents are based on a third of average local household incomes. To make sure families can afford to take part in the scheme, the rent for a three-bedroom property is set at no more than 10% above the cost of a two-bedroom property. And the rent for any home must be at least 20% below its assessed market rent.
The average monthly rent, across London, for a 2-bedroom London Living Rent home is approximately £1,077 per month, which is almost three quarters of the median average market rent.
In most boroughs, the cost of renting through London Living Rent will be less than renting privately.
London Living Rent - a route to home ownership
London Living Rent homes give tenants the chance to put themselves on a pathway to home ownership. Housing providers, like Peabody New Homes, are expected to take into account prospective tenants’ ability and desire to save as part of the affordability assessment. They will also support tenants into home ownership within ten years.
In most cases, London Living Rent tenants will be offered their current home on Shared Ownership terms at any time during the tenancy. If tenants do not take up this right within ten years, the provider would be expected to sell it to another eligible purchaser on a Shared Ownership basis.
"We really wanted to stay in London and buying through Shared Ownership was the best way to make this happen. Everyone at Peabody New Homes was so helpful and very efficient, guiding us through each stage of the process. From my initial phone call, they managed to book me an appointment for the following week. I was so impressed with the quality of the homes here."